CAIE A-Level Economics 7.3.3 Pareto optimality

CAIE A-Level Economics 7.3.3 Pareto optimality
Cambridge International AS & A Level Economics 9708 syllabus for exams in 2026, 2027 and 20282026–2028

Practise testing whether reallocations are Pareto improvements and linking Pareto optimality to efficient resource allocation.

How this is tested

  • judge whether a reallocation makes someone better off without making others worse off
  • interpret goods-allocation tables or economy scenarios for Pareto improvement or optimality

Question 5

[Maximum number: 1]

What is most likely to lead to a Pareto-optimal outcome?

A

offering bulk-buy discounts to customers who join a loyalty scheme

B

switching labour from producing low-priced products to producing high-priced products

C

switching production from labour-intensive products to capital-intensive products

D

training low-skilled workers to operate machinery effectively